Expat wanderer

Qatar Rents Expected to Fall Further as Supply Exceeds Demand

Experts expect house rents to fall further
Web posted at: 9/28/2009 0:55:46Source ::: The Peninsula
DOHA: Real estate experts estimate that some 6,000 new housing units have sprung up in Doha and its suburbs for uptake this year alone.

With supplies having gone up, the experts expect house rents to fall by a further five to 10 percent over the short term.

House rents are believed to have dropped between 30 and 40 percent until now, says the manager of a real estate company, Falah Matar.

“So due to higher supply, tenants now have a lot of option,” he added.

According to Khalifa Al Muslemani, another real estate expert, some 6,000 new housing units have come on the market this year, further pushing supplies higher.

These are both private and semi-government projects. “Higher supplies have led to a fall in rents,” added Al Muslemani.

Talking of the existing rent law which was enforced in early 2008 for two years, Matar said there was the need for a new legislation to replace it once it expires in February next year.

The proposed law should either lower the limit by which landlords can raise rents annually to five percent, or retain the existing limit of 10 percent.

He allayed fears among tenants that once the current rent law expires landlords would begin to raise rents unjustifiably like they did in the previous years.

He said that due to excess supplies, tenants facing this kind of pressure from property owners would have the option to leave and look for alternative accommodation.

Agreeing with this view, an official from a real estate agency, Mahmoud Al Jirsha said tenants need not worry about landlords raising rents unjustifiably because of huge supplies.

The situation in the previous years was different because housing supplies were limited and the demand was far too more. “Reverse is the case now as supplies far exceed demand,” he added.